How to Reduce Cloud Bills: 11 Practical Ways

Reduce cloud bills with cost optimization & monitoring. Learn practical ways to control cloud spending, reduce waste, and improve cost visibility.

Costs associated with cloud services can grow exponentially. You may initially only have a few virtual machines, some storage, and a couple of data pipelines, but as your cloud environment grows, you may find costs accumulating rather quickly.

The good news is that some easy cost controls can really help. When teams understand where costs are going, ownership of individual costs is defined, and usage of resources is monitored, teams can actively manage their cloud costs.

Reducing cloud bills can be simpler than you think, and here are 11 real-world tips to get you started.

1. Define Clear Ownership

Cost control hinges on accountability. If nobody takes accountability for a cloud bill, reducing costs becomes a game of chance.

There are a few approaches you can take to define ownership, which include:

• Separating spending into Projects and business units.
• Defining owners of workloads.
• Aligning cost vs performance metrics.

2. Tag and Classify Resources

Resources that are untagged are either efficiencies left on the table or are oversights waiting to cost your company time and money when you least expect it. Because of this, it is best to create a habit of tagging resources as soon as they are created.

3. Monitor Usage in Real Time

Stale reports show spending over time, but real-time monitoring helps teams act first.

Set automated spend and billing alerts up in Slack or through email. Also, keep an eye out for underused resources that are consistently going unused.

Because of this, teams can act before unexpected resource usage leads to a large expense

4. Rightsize Compute Resources

Money is wasted on overprovisioned virtual machines by organizations. Low usage of a virtual machine’s CPU can be an indication that the workload does not warrant the size of that virtual machine.

Look at the data for resource utilization before resizing any resources. Also, utilize an autoscaling function to help adjust resources inline with a workload’s changing demand.

For workloads that do not require continuous resource availability, consider using serverless computing or containers.

5. Optimise Storage

Often storage is a hidden expense for cloud services because customers Store backups and snapshots in higher cost storage.

Lower storage costs by:

• Using storage tiers that are cold or archival and moving data used less frequently.
• Deleting old snapshots and backups.
• Using storage that compresses and deduplicates.

6. Use Reserved Instances and Savings Plans

Thus helping your business avoid spending money on computing resources that are no longer required.

Before committing to a Savings Plan or Reserved Instance:

• Patterns of consistent usage.
• Make reserved and on-demand resource commitments that meet the need.
• Review commitments based on changing needs.

Thus helping your business avoid spending money on computing resources that are no longer required.

7. Find Idle and Orphaned Resources

Cloud bills can increase due to unused resources that remain idle. Some of these resources may include idle virtual machines, unattached disks, and unused load balancers.

Organize periodic scans to determine idle resources that exceed 30 days of inactivity. In addition, automate the shutdown of development and test environments during off-hours.

Before resource removal, identify the resource owner by adding a tag to the resource.

8. Control Networking Costs

Networking costs can be easy to overlook. Data transfer in single-region or hybrid environments can add significantly to cloud spending.

You should:

• Keep traffic within the region when possible.
• Use content delivery networks for suitable traffic.
• Review VPN and peering configurations regularly.

These checks can help reduce unnecessary network costs.

9. Automate Cost Controls

• Automation for cost controls is a necessity for growing cloud infrastructure.
• Development and test suites should be shut down during non-business hours.
• Establish guidelines for tagging, resource sizing, and storage.
• Use “infrastructure as code” for the rules just mentioned.
• Use policy controls to manage the configurations.

This will reduce the number of steps needed to manage cloud costs.

10. Review Licences and Third Party Costs

Costs for business software and SaaS applications can add up quickly in the cloud. Look into which tools your teams are using.

You may consider:

• Eliminate unused costs.
• Consolidating where you can.
• Negotiating enterprise license agreements.
• Reviews can help avoid high costs.

11. Make Cloud Cost Management Ongoing

Cloud cost management should not be a one-time task. Due to the constant changes in workloads and costs, cloud cost management should also be done continuously.

Cost management should be done for the following in the scope of your business:

• Workload
• Environment
• Project
• Business unit

This will help teams understand how cloud cost management affects them.

Conclusion

Reduced cloud spending is not about spending less, but more about increased spending visibility and ownership.

Monitoring spending, storage, and automating processes can help manage costs continuously. To do this, businesses should ensure cost management is a process done frequently and regularly.